Budget signals shifting attitudes towards procurement, Ottawa-based tech group says

John Reid
John Reid

The 2017 federal budget’s fresh approach to procurement has received a nod of approval from the Canadian Advanced Technology Alliance.

John Reid, CEO of CATA, says that while the announced programs and funding are a positive start, what’s really exciting him is the attitude he’s seeing from the government.

“We gave it two thumbs up, and that’s not because there isn’t more to be done and things to be changed, it’s that it represented a pivot or change in mindset,” he tells OBJ. “It’s something we can build on instead of something to attack.”

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Changes to government procurement were among the highlights of Wednesday’s budget for local businesses alongside cash for technology firms across the country.

CATA has been lobbying for a budget like this for many years as part of its “competitive innovation nation” campaign. The focus on innovation that Mr. Reid sees in this budget makes him believe that the government is ready to adopt the kinds of “21st-century procurement practices” that advocates have long been after.

“We’ve put forward the importance of procurement for many years as a marketplace for Canadian technologies and solutions,” he says. “It makes everybody a builder and creator.”

The budget allocates up to $50 million for a new procurement program called Innovative Solutions Canada. According to the document, federal departments and agencies will allocate portions of funding towards early-stage research and prototypes.

How exactly companies will be able to get involved, as well as other details about the program, will be announced in the coming months, according to budget documents.

The goal is to provide small businesses with a strong initial customer in the form of the federal government. The federal government is the largest buyer of goods and services in Ottawa-Gatineau and spent some $2.89 billion with local firms in 2015-16, according to OBJ’s Book of Lists.

A similar program launched by the Conservative government in 2012 was aimed at companies ready to enter the market, rather than encouraging the early-stage development of startups with new technologies.

While the procurement program is a strong start, as is the overall innovation messaging of the budget, Mr. Reid still sees work to be done. He’s already assembled a team to follow up on the development of the procurement program.

Ideally, he’d like to see more features that mimic the United States’ Small Business Innovation Research Program, which the budget cites as a model for procurement. The program, established in 1977 and refined ever since, features multiple phases of government funding without the need for separately raised funds to match. Countries such as the United Kingdom, Australia, Japan and Sweden have modelled similar programs after the United States’ approach.

CATA’s advocacy campaign for a Canadian SBIR suggests that such a program would, for example, improve the amount of PhD-level research in Canadian industry and would encourage the founding of high-tech companies.

As the U.S. SBIR has been well-established for 40 years, Mr. Reid knows the Canadian procurement process will not abruptly change in the next two years. This budget, however, gives him plenty to look forward to as CATA seeks to implement a modern program that will establish and grow Canadian businesses.

“The federal budget, for the first time in many years, has an innovation footprint,” he says. “You can’t help but be encouraged.”

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